(Let me preface this by saying that I just bought this car -- '92 190E -- 4 months ago. I know very little about its service history. I DO know that the previous owner had it serviced by a "friend" who was a mechanic at a neighborhood garage. I've found a few minor things that were not done properly -- but nothing major)

So here's my problem: I just got my '92 190E back from the alignment shop, and they said the ball joint on the passenger side is partially pulled out of the steering knuckle. They said they've never seen this before, but admitted they have limited experience with MB cars. I checked, and sure enough, there IS an extra centimeter of rod between the knuckle and the ball joint on the passenger side -- but it doesn't look like it's being pulled out. I looks like the wrong ball joint is on there. One with a longer shaft.

QUESTION #1: Does the ball joint from a similar car (say a 300E) have a longer shaft but the same size ball joint. (So that it would fit, just not properly?

The 300E and 190 use exactly the same balljoint. There is therefore no chance of the mixup you describe.

Last weekend, a went over some speedbumps (slowly) in my 300E, and one of the balljoints popped out of its socket! This is not a good situation to be in, though I'm glad it did not happen on an exit ramp instead.
I have never seen this particular failure mode, though I have replaced a dozen balljoints on non-MB cars. The rubber boot was even intact on a prior inspection, which usually indicates the joint is ok. In fact, even though the balljoint was completely shot, the handling was not bad, and the steering felt ok. It even passed State inspection. Basically, the warning signs of massive failure were just not there.
My point in telling you this is that your 190 might be halfway to the same critical (and potentially life-threatening) failure.

How can you tell if a balljoint is healthy?
1) Place a floor jack under the offending control arm, and lift until the tire is slightly off the ground.
2) Grasp the top and bottom of the tire, and attempt to wiggle it in and out while watching the ball joint (an assitant is helpful). There should be no play.

If this is ok, it is also possible that the balljoint stem is somehow sliding out of its mount. Check to see if the bolt is loose. On the 300E, the torque value is 94 Ft/Lbs for this bolt. If it was not torqued properly when installed, any play could have warn away the bolt, allowing the stem to slide downward. Perhaps it was not set right in the first place, or the wrong size or type of bolt was used.
The balljoint stem has a groove carved into one side that the bolt passes through, so using just the right bolt is important.

No matter what, I would suggest taking it apart for a closer look. This is not something you want to mess around with. The stakes are too high.
Good luck